EXHIBIT 10.1.3
Amended and Restated 1997 Stock Option Plan.
FEDERAL AGRICULTURAL MORTGAGE CORPORATION
AMENDED AND RESTATED 1997 INCENTIVE PLAN
1. Purpose of the Plan
The purposes of this Amended and Restated 1997 Incentive Plan (the
"Plan") are to encourage stock ownership by directors, officers, and key
employees of the Federal Agricultural Mortgage Corporation (the "Company") and
its subsidiaries, to provide an incentive for such individuals to expand and
improve the profits and prosperity of the Company and its subsidiaries, and to
assist the Company and its subsidiaries in attracting and retaining directors
and key personnel through the grant of Options (as defined herein) to purchase
shares of the Company's Class C nonvoting common stock, par value $1.00 per
share (the "Common Stock").
2. Persons Eligible Under Plan
Any person who is an officer or employee of the Company or any
subsidiary (as defined in Sections 424(f) and 424(g) of the Internal Revenue
Code of 1986, as amended (a "Subsidiary"), shall be eligible for awards under
the Plan (a "Participant"). Any member of the Board of Directors (the "Board")
of the Company (a "Director") who is not also an employee of the Company shall
be eligible to receive any awards only under Section 15 of the Plan ("Director
Options").
3. Stock Subject to Plan
Subject to Section 10, the maximum number of shares that may be the
subject of awards under the Plan shall be 3,750,000 shares of the Company's
Common Stock, which shall be made available either from authorized but unissued
Common Stock or from Common Stock reacquired by the Company, including shares
purchased in the open market. If any award granted under the Plan is canceled,
forfeited, or otherwise terminates or expires for any reason without having been
exercised in full, the shares of Common Stock allocable to the unexercised
portion of such award may again be the subject of grants under the Plan.
4. Administration of Plan
(a) Except for the provisions of Section 15 (which to the maximum
extent feasible shall be self-effectuating), the Plan shall be administered by
(i) the Board of Directors for any purpose under the Plan, (ii) a committee of
the Board consisting of two or more Directors, each of whom is a "Non-Employee
Director" under Securities Exchange Act Rule 16b-3, for any purpose under the
Plan, or (iii) a committee of the Board consisting of two or more Directors
(whether or not any such Director is a "Non-Employee Director") for purposes of
any award under the Plan to an employee other than an officer subject to Section
16 of the Securities Exchange Act of 1934 (it being understood and agreed that
references herein to the "Committee" shall mean the Board or either committee
referred to above, as the case may be).
(b) Subject to the express provisions of the Plan, the Committee shall
be authorized and empowered to do all things necessary or desirable in
connection with the administration of the Plan, including, without limitation,
the following:
(i) interpret and construe the Plan and the terms and
conditions of any award hereunder;
(ii) adopt, amend, and rescind rules and regulations for
the administration of the Plan;
(iii) determine which persons meet the eligibility
requirements of Section 2 hereof and to which of such eligible persons,
if any, awards will be granted hereunder;
(iv) grant awards to eligible persons and determine the terms
and conditions thereof, including, but not limited to, the number of
shares of Common Stock issuable pursuant thereto, the time not more
than 10 years after the date of an award at which time the award shall
expire or (if not vested) terminate, and the conditions upon which
awards become exerciseable or vest or shall expire or terminate, and
the consideration, if any, to be paid upon receipt, exercise or vesting
of awards;
(v) determine whether, and the extent to which, adjustments
are required pursuant to Section 10 hereof;
(vi) determine the circumstances under which, consistent with
the provisions of Section 11, any outstanding award may be amended;
(vii) exercise its discretion with respect to the powers and
rights granted to it as set forth in the Plan; and
(viii) generally, exercise such powers and perform such acts
as deemed necessary or advisable to promote the best interests of the
Company with respect to the Plan.
(c) Any action taken by, or inaction of the Company, the Board, or the
Committee relating or pursuant to the Plan, shall be within the absolute
discretion of that entity or body and shall be conclusive and binding upon all
persons. No member of the Board or officer of the Company shall be liable for
any such action or inaction of: (i) the entity or body; (ii) another person; or
(iii) except in circumstances involving bad faith, himself or herself. In making
any determination or in taking or not taking any action under the Plan, the
Board and the Committee may obtain and may rely upon the advice of experts,
including professional advisors to the Company.
(d) The Committee may delegate ministerial, non-discretionary functions
to individuals who are officers or other employees of the Company.
5. Awards
(a) Awards under the Plan shall consist of options ("Options") to
purchase the Common Stock of the Company and shall be evidenced by agreements
(the "Award Agreements") in such form as the Committee shall approve.
(b) The exercise price per share shall be 100% of the Fair Market Value
of one share of Common Stock on the date the Option is granted (the "Exercise
Price"), subject to adjustment only as provided in Section 10 of the Plan. As
used in the Plan, the term "Fair Market Value" shall mean the composite closing
price of the Company's Common Stock as reported on the National Association of
Securities Dealers Automated Quotations system ("NASDAQ"), or such other market
on which the Common Stock may be listed or traded, as determined by the
Committee. If there is not a composite closing price quotation for the date as
of which Fair Market Value is to be determined, then the Fair Market Value shall
be determined by reference to the composite closing price quotation for the next
preceding day on which a composite closing price quotation is available.
(c) In connection with establishing the level of Option awards under
the Plan, the value of an Option shall be calculated by an independent third
party acceptable to the Committee (the "Compensation Consultant") and shall be
based on the "Black-Scholes" method of option valuation, as determined by the
Compensation Consultant. In calculating the Black-Scholes value of an Option,
the average of the composite closing prices of the Company's Common Stock as
reported by NASDAQ, or such other market on which the Common Stock may be listed
or traded, as determined by the Committee, for the 90-day period preceding such
calculation shall be the used by the Compensation Consultant as the "current
market price" and "exercise price" inputs to such Black-Scholes calculation,
irrespective of the Fair Market Value of a share of Common Stock on the date of
calculation. Notwithstanding the foregoing, the Exercise Price of any Option
awarded under the Plan shall be the Fair Market Value of one share of Common
Stock on the date the Option is granted, as provided in subsection (b) above.
6. Exercise of Options
(a) Options may be exercised in whole or in part at such time or times
as shall be determined by the Committee and set forth in the applicable Award
Agreement. A Participant electing to exercise an Option shall give written
notice to the Company of such election and of the number of shares he or she has
elected to purchase, and shall at the time of exercise tender the full Exercise
Price for those shares.
(b) The Exercise Price shall be payable in cash or by check; provided,
however, that to the extent provided in the applicable Award Agreement, the
Participant may pay the Exercise Price in whole or in part (i) by delivering to
the Company shares of the Common Stock owned by him and having a Fair Market
Value on the date of exercise equal to the Exercise Price of the Option or (ii)
by reducing the number of shares of Common Stock issuable or payable upon the
exercise of an Option by the number of shares of Common Stock having a Fair
Market Value on the date of exercise equal to the Exercise Price of the Option.
In addition, the Options may be exercised through a registered broker-dealer
pursuant to such cashless exercise procedures (other than share withholding)
which are, from time to time, deemed acceptable. No fractional shares of Common
Stock shall be issued upon exercise of an Option and the number of shares of
Common Stock that may be purchased upon exercise shall be rounded to the nearest
number of whole shares.
(c) At such times as a Participant recognizes taxable income in
connection with the receipt of shares of Common Stock hereunder (a "Taxable
Event"), the Participant shall pay to the Company the amount of taxes required
by law to be withheld by the Company in connection with the Taxable Event (the
"Withholding Taxes") prior to the issuance of such shares. In satisfaction of
the obligation to pay the Withholding Taxes to the Company, the Participant may
make a written election (the "Tax Election"), which may be accepted or rejected
in the discretion of the Committee, to have withheld a portion of the shares of
Common Stock then issuable to him or her having an aggregate Fair Market Value
equal to the Withholding Taxes.
7. Right of First Refusal
The Committee may, in its discretion, include in any Award Agreement
relating to an Option granted under the Plan a condition that the Participant
shall agree to grant the Company a Right of First Refusal, which, if so
included, shall have the following terms and conditions:
(a) The Participant shall give the Company written notice (the "Offer
Notice") of the Participant's intention to sell any shares of Common Stock
acquired (or to be acquired) upon exercise of an Option (the "Offered Shares").
The Company shall have three business days (the "Exercise Period") following
receipt of the Offer Notice to determine whether to exercise its Right of First
Refusal, which may be exercised either as to all or as to none of the Offered
Shares. By the end of the Exercise Period, the Company shall have given written
notice to the Participant of its election to exercise (the "Acceptance notice")
or not to exercise (the "Rejection Notice") its Right of First Refusal. The
Participant shall tender the Offered Shares to the Company within 10 business
days after receipt of an Acceptance Notice. Upon receipt of a Rejection Notice,
the Participant may sell the Offered Shares free and clear of such Right of
First Refusal.
(b) The price to be paid by the Company for the Offered Shares shall be
the average of the closing price of the Company's Common Stock as reported on
NASDAQ (or such other market on which the Common Stock may be listed or traded,
as determined by the Committee) for the three business days immediately
preceding the date of the Company's receipt of the Offer Notice or, if no such
transactions occurred on those days, the average of the bid and asked prices for
the Common Stock on such days.
8. Transfer Restrictions
(a) Unless otherwise permitted in the applicable Award Agreement, any
Option granted under the Plan shall not be transferable other than by will or
the laws of descent and distribution or pursuant to a domestic relations order,
and during a Participant's lifetime shall be exercisable only by the Participant
or his or her guardian or legal representative. The terms of such Option shall
be final, binding and conclusive upon the legal representatives, heirs and
successors of the Participant.
(b) Notwithstanding the foregoing, the Committee may, in its
discretion, authorize all or a portion of the Options to be granted to an
Optionee to be transferred to: (i) the spouse, siblings, parents, children or
grandchildren of the Optionee ("Immediate Family Members"); (ii) a trust or
trusts for the exclusive benefit of such Immediate Family Members; or (iii) a
partnership in which such Immediate Family Members are the only partners;
provided, however, that (x) there may be no consideration for any such transfer,
(y) the Award Agreement pursuant to which the Options are granted must expressly
provide for transferability in a manner consistent with this Section 8 and (z)
subsequent transfers of transferred Options shall be prohibited, except those in
accordance with the subsection (a) above. Following transfer, any such Options
shall continue to be subject to the same terms and conditions as were applicable
immediately prior to transfer, provided that the term "Optionee" shall be deemed
to refer to the transferee.
9. Termination of Employment
(a) Except as provided in the Award Agreement and as provided in
Sections 9(b), (c) or (d) below, if a Participant ceases for any reason to be
employed by the Company or any of its Subsidiaries (unless such termination of
employment was for "Cause"), the Participant may, at any time within 90 days
after the effective date of such termination of employment, exercise his or her
Options to the extent that he or she would be entitled to exercise them on such
date, but in no event shall any Option be exercisable more than 10 years from
the date it was granted; provided, however, that the Committee shall have the
discretion to determine whether Options not yet exercisable at the date of
termination of employment shall become immediately exercisable for 90 days
thereafter. The Committee shall determine, subject to applicable law, whether a
leave of absence shall constitute a termination of service.
(b) If a Participant ceases to be employed by the Company or any of its
Subsidiaries for "Cause," the Participant's unexercised Options shall terminate
immediately. For purposes of this Section 9, "Cause" shall be defined as in the
employment agreement, if any, between the Company and such Participant, or, if
there is no employment agreement, shall mean (i) the willful failure of the
Participant substantially to perform his or her duties, other than any such
failure resulting from incapacity due to physical or mental illness or (ii) the
willful engagement by the Participant in activities contrary to the best
interests of the Company.
(c) Unless otherwise provided in the Award Agreement, if a Participant
dies while employed by the Company or any of its Subsidiaries, or within 90 days
after having retired with the consent of the Company, the shares which the
Participant was entitled to exercise on the date of the Participant's death
under an Option or Options granted under the Plan may be exercised at any time
after the Participant's death by the Participant's beneficiary; provided,
however, that no Option may be exercised after the earlier of (i) one (1) year
after the Participant's death or (ii) the expiration date specified for the
particular Option in the Award Agreement; and provided, further, that any
unvested Option or Options shall immediately vest upon the death of a
Participant while employed by the Company and may be exercised as provided in
this Section 9(c).
(d) Unless otherwise provided in the Award Agreement, if a Participant
terminates employment by reason of Disability (as defined below), any
unexercised Option held by the Participant shall, if unvested, immediately vest
and shall expire one (1) year after the Participant has a termination of
employment because of such "Disability" and such Option may only be exercised by
the Participant or his or her beneficiary to the extent that the Option was
exercisable on the date of termination of employment because of such
"Disability;" provided, however, no Option may be exercised after the expiration
date specified for the particular Option in the Award Agreement. "Disability"
shall mean (a) in the case of a Participant whose employment with the Company or
a Subsidiary is subject to the terms of an employment agreement between such
Participant and the Company or Subsidiary, which employment agreement includes a
definition of "Disability", the term "Disability" as used in this Plan or any
Award Agreement shall have the meaning set forth in such employment agreement
during the period that such employment agreement remains in effect; and (b) in
all other cases, the term "Disability" as used in this Plan or any Award
Agreement shall mean a condition that (in the opinion of an independent medical
consultant) has rendered the Participant mentally or physically incapable of
performing the services required to be performed by the Participant and has
resulted in the termination of the directorship or employment relationship, as
the case may be.
10. Adjustments
(a) In the event of a Change in Capitalization (as defined below) of
the Company, the Committee shall conclusively make equitable and appropriate
adjustments, if any, to (i) the maximum number and class of shares of Common
Stock or other stock or securities with respect to which Options may be granted
under the Plan, (ii) the maximum number and class of shares of Common Stock or
other stock or securities with respect to which Options may be granted to any
Participant during the term of the Plan, (iii) the number and class of shares of
Common Stock or other stock or securities which are subject to outstanding
Options granted under the Plan and the purchase price therefor, if applicable
and (iv) the number and class of shares of Common Stock or other securities in
respect of which Director Options are to be granted under Section 15 hereof.
(b) If, by reason of a Change in Capitalization, a Participant shall be
entitled to exercise an Option with respect to new, additional or different
shares of stock or securities, such new, additional or different shares shall
thereupon be subject to all of the conditions, restrictions and performance
criteria which were applicable to the shares of Common Stock subject to the
Option prior to such Change in Capitalization.
(c) No adjustment of the number of shares of Common Stock available
under the Plan or to which any Option relates that would otherwise be required
under this Section 10 shall be made unless and until such adjustment either by
itself or with other adjustments not previously made under this Section 10 would
require an increase or decrease of at least 1% in the number of shares of Common
Stock available under the Plan or to which any Option relates immediately prior
to the making of such adjustment (the "Minimum Adjustment"). Any adjustment
representing a change of less than such minimum amount shall be carried forward
and made as soon as such adjustment together with other adjustments required by
this Section 10 and not previously made would result in a Minimum Adjustment.
Notwithstanding the foregoing, any adjustment required by this Section 10 which
otherwise would not result in a Minimum Adjustment shall be made with respect to
shares of Common Stock relating to any Option immediately prior to exercise of
such Option. No fractional shares of Common Stock or units of other securities
shall be issued pursuant to any such adjustment, and any fractions resulting
from any such adjustment shall be eliminated in each case by rounding downward
to the nearest whole share.
(d) "Change in Capitalization" means any increase or reduction in the
number of shares of Common Stock, or any change (including, but not limited to,
a change in value) in the shares of Common Stock or exchange of shares of Common
Stock for a different number or kind of shares or other securities of the
Company or another corporation, by reason of a reclassification,
recapitalization, merger, consolidation, reorganization, spin-off, split-up,
issuance of warrants or rights or debentures, stock dividend, stock split or
reverse stock split, cash dividend in excess of earnings, property dividend,
combination or exchange of shares, change in corporate structure or other
substantially similar event.
11. Amendment and Termination of Plan
The Board or the Committee, by resolution, may terminate, amend, or
revise the Plan with respect to any shares as to which Options have not been
granted. Neither the Board nor the Committee may, without the consent of a
Participant, alter or impair any award previously granted under the Plan, except
as authorized herein. To the extent necessary under applicable law, no amendment
shall be effective unless approved by the stockholders of the Company in
accordance with applicable law. Unless sooner terminated, the Plan shall remain
in effect for a period of 10 years from the date of the Plan's adoption by the
Board. Termination of the Plan shall not affect any Option previously granted.
12. Effective Date of Plan
This Plan shall be effective on the date upon which it is approved by
the Board.
13. Governing Law
(a) Except as to matters of federal law, the Plan and the rights of all
persons claiming hereunder shall be construed and determined in accordance with
the laws of the District of Columbia, without giving effect to conflicts of laws
principles thereof.
(b) The obligation of the Company to sell or deliver the shares of
Common Stock with respect to Options granted under the Plan shall be subject to
all applicable laws, rules and regulations, including all applicable federal and
state securities laws, and the obtaining of all such approvals by governmental
agencies as may be deemed necessary or appropriate by the Committee.
(c) Each Option is subject to the requirement that, if at any time the
Committee determines, in its discretion, that the listing, registration or
qualification of the shares of Common Stock issuable pursuant to the Plan is
required by any securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, the grant of an Option or
the issuance of the shares of Common Stock, no Options shall be granted or
payment made or shares issued, in whole or in part, unless listing,
registration, qualification, consent or approval has been effected or obtained
free of any conditions as acceptable to the Committee.
14. Multiple Agreements
The terms of each Option may differ from other Options granted under
the Plan at the same time, or at some other time. The Committee may also grant
more than one Option to a given Participant during the term of the Plan, either
in addition to, or in substitution for, one or more Options previously granted
to that individual.
15. Director Options
(a) Awards relating to the Common Stock authorized under the Plan shall
be made under this section only to Directors.
(b) Annually, on the date of the Annual Meeting of Stockholders,
commencing with the Annual Meeting in 1998, there shall be granted automatically
(without any action by the Committee or the Board) a Director Option to each
Director then elected to office to purchase 2,000 shares of Common Stock.
(c) The Exercise Price for shares under each Director Option shall be
equal to 100% of the Fair Market Value of a share of Common Stock on the date
the Director Option is granted, determined in accordance with Section 5(b)
hereof. The Exercise Price of any Director Option granted shall be paid in full
at the time of each purchase (a) in cash and/or (b)(i) by delivering to the
Company shares of the Common Stock owned by the Director and having a Fair
Market Value on the date of exercise equal to the Exercise Price of the Director
Option, or (ii) by reducing the number of Shares of Common Stock issuable or
payable upon the exercise of a Director Option by the number of shares of Common
Stock having a Fair Market Value on the date of exercise equal to the Exercise
Price of the Director Option. In addition, the Options may be exercised through
a registered broker-dealer pursuant to such cashless exercise procedures (other
than share withholding) which are, from time to time, deemed acceptable. No
fractional shares of Common Stock shall be issued upon exercise of an Option and
the number of shares of Common Stock that may be purchased upon exercise shall
be rounded to the nearest number of whole shares. Each Director Option shall be
subject to the Right of First Refusal, as set forth in Section 7.
(d) At such times as a Director recognizes taxable income in connection
with the receipt of shares of Common Stock hereunder (a "Taxable Event"), the
Director shall pay to the Company the amount of taxes required by law to be
withheld by the Company in connection with the Taxable Event (the "Withholding
Taxes") prior to the issuance of such shares. In satisfaction of the obligation
to pay the Withholding Taxes to the Company, the Director may make a written
election (the "Tax Election"), which may be accepted or rejected in the
discretion of the Committee, to have withheld a portion of the shares of Common
Stock then issuable to him or her having an aggregate Fair Market Value equal to
the Withholding Taxes.
(e) An annual Director Option grant under Section 15(b) shall become
fully vested and exercisable at the rate of one third of the Shares (rounded
down to the nearest whole share number) immediately on the date of grant and one
third on May 31 of each of the following two years if the Director who is an
optionee under the Director Option continues to serve as a Director as of such
date.
(f) Each Director Option shall terminate on the date which is the fifth
anniversary of the date of grant (the "Option Termination Date"), unless
terminated earlier as follows:
(i) If a Director's service as a member of the Board
terminates for any reason other than death or Cause (as defined below),
the Director may for a period of up to two years after such termination
(but not later than the Option Termination Date) exercise his or her
Option to the extent, and only to the extent, that such Option was
vested and exercisable as of the date the Director's service as a
member of the Board terminated, after which time the Option shall
automatically terminate in full.
(ii) If a Director's service as a member of the Board
terminates for Cause, the Option granted to the Director hereunder
shall immediately terminate in full and no rights thereunder may be
exercised. For purposes of this Section 15, "Cause" shall mean (i)
fraud or intentional misrepresentation, (ii) embezzlement,
misappropriation or conversion of assets or opportunities of the
Company, (iii) conviction of a felony or (iv) willful engagement by the
Director in activities contrary to the bests interests of the Company.
(iii) If a Director dies while a member of the Board or within
24 months after termination of service as a Director as described in
clause (i) of this Section 15(f), the Option granted to the Director
may be exercised at any time within twelve (12) months after the
Director's death (but not later than the Option Termination Date) by
the person or persons to whom such rights under the Option shall pass
by will, or by the laws of descent or distribution, after which time
the Option shall terminate in full; provided, however, that an Option
may be exercised to the extent, and only to the extent, that the Option
was exercisable on the date of death or earlier termination of the
Director's service as a member of the Board; and provided, further,
that any unvested Option or Options shall immediately vest upon the
death of a Director while a member of the Board.
(g) If there shall occur any event described in Section 10, then in
addition to the matters contemplated thereby, the Director Options then
outstanding and future grants thereof shall be automatically adjusted as
contemplated by Section 10.
(h) The provisions of Sections 1, 2, 3, 7, 8, 10, 11, 12 and 13 are
incorporated herein by this reference. Unless the context otherwise requires,
the provisions of this Section 15 shall be construed as a separate plan.
Originally adopted: February 13, 1997
First Amendment: June 12, 1997
Second Amendment: August 7, 1997
Third Amendment: February 5, 1998
Fourth Amendment: June 4, 1998
Fifth Amendment: April 12, 1999
Sixth Amendment: August 2, 1999